Summary of What This Blog Covers:
- Unpacks six powerful but underused tax deductions for entrepreneurs
Breaks down how to legally claim overlooked write-offs like the home office deduction, business mileage, startup costs, and Section 179 to significantly reduce your tax bill. - Explains key strategies like the Augusta Rule and QBID with actionable guidance
Offers real-world insight on how to properly structure and document deductions like renting your home to your business or leveraging the Qualified Business Income Deduction. - Covers what happens when these deductions are missed or misapplied
Details the costly consequences of poor tracking, incomplete documentation, and tax planning gaps and how a certified public accountant can fix them. - Shows how Insogna CPA provides expert tax strategy, not just tax prep
Highlights how our Austin-based CPA firm helps entrepreneurs uncover savings, stay compliant, and create year-round strategies that keep more profit in their business.
You’re hustling, scaling, reinvesting, and building something that matters. The last thing you want? Overpaying taxes because you didn’t know what you could legally deduct.
Let’s call it what it is: the IRS doesn’t reward ignorance, and unfortunately, the most valuable tax breaks aren’t always obvious. They’re buried in code, loaded with fine print, and easy to miss if you don’t have a strategy.
At Insogna CPA, a full-service Austin Texas CPA firm, we specialize in helping entrepreneurs keep more of what they earn. Not just by filing taxes, but by guiding smart decisions all year long.
These six overlooked deductions could put thousands back in your pocket this year. Here’s how to identify, qualify for, and maximize each of them.
1. The Home Office Deduction: Modern and Misunderstood
Yes, you can write off that beautifully efficient corner of your home where you answer emails, lead Zoom calls, and run your business empire.
But here’s where most business owners get it wrong:
- They think it’ll raise audit flags (not true when done properly)
- They don’t know how to calculate it
- Or they simply forget about it during tax prep
Two ways to calculate:
- Simplified Method: $5 per square foot, up to 300 square feet = up to $1,500
- Actual Expense Method: Deduct a percentage of your actual home expenses including mortgage interest, rent, utilities, repairs, and insurance
Key requirements:
- The space must be exclusively used for business
- It must be used regularly
- It must be your principal place of business
A CPA near you, preferably a certified public accountant in Austin, can help determine the method that saves you the most based on your space, lifestyle, and income.
2. Business Vehicle Use and Mileage But Only If You Track It
Using your personal vehicle for business whether it’s for client meetings, picking up supplies, or heading to an event? Good news: the IRS lets you deduct those miles or vehicle expenses. But (and it’s a big but), you have to keep solid records.
In 2025, you have two deduction methods to choose from:
Standard Mileage Rate (2025)
- 70 cents per mile (updated for 2025)
- Includes fuel, maintenance, depreciation, insurance, everything is built into that flat rate
- Simple, efficient, and great if you don’t want to track every receipt
Actual Expense Method
- Track actual costs: gas, repairs, insurance, registration, depreciation
- Multiply total vehicle expenses by the percentage you used the car for business
- Typically better for newer vehicles or if you have higher maintenance and fuel costs
To qualify, the IRS expects accurate, consistent logs, not your best guess.
Use apps like MileIQ, Everlance, or QuickBooks Self-Employed to automate tracking and keep a compliant logbook.
Not sure which method will give you the bigger deduction? A small business CPA in Austin (like us) can calculate both and help you choose the one that saves you more in taxes.
3. Section 179 and Bonus Depreciation (2025): Immediate Write-Offs for Equipment
Still think depreciation means writing off a few hundred bucks a year over a decade? That’s old news.
In 2025, Section 179 and Bonus Depreciation allow you to deduct a significant portion or even the full cost of qualifying business equipment in the year it’s placed in service. These are powerful tax tools for growing businesses investing in vehicles, machinery, or technology.
Section 179 Deduction (2025 limits):
- Deduct up to $1.22 million of qualifying business purchases
- Applies to vehicles, computers, office furniture, software, and machinery
- Asset must be purchased and in use by December 31, 2025
- You must have taxable business income—this deduction can’t create a loss
Bonus Depreciation (2025):
- Allows you to deduct 60% of the asset’s cost in year one
- Can be used even if you’re running at a loss
- Applies to new and used qualified property
- No dollar limit on the total assets you can depreciate
Bonus depreciation is currently phasing down under the Tax Cuts and Jobs Act—80% in 2023, 60% in 2025, and potentially lower in future years (unless legislation changes).
Used together, Section 179 and Bonus Depreciation can significantly reduce your 2025 tax bill if you’re investing in growth.
Need help navigating which assets qualify and how to report them? A licensed CPA in Austin, Texas (like us) can walk you through the IRS rules, handle proper classifications, and make sure you document everything to stay audit-proof.
4. The Augusta Rule: Yes, You Can Rent Your Home to Your Business
It’s obscure. It’s niche. And it’s incredibly effective when done right.
The Augusta Rule (IRS Section 280A(g)) allows you to:
- Rent your home to your business for meetings, retreats, or events
- The business deducts the rent as an expense
- You, the homeowner, receive the income tax-free, up to 14 days per year
Let’s say your home rents for $600/day. Four quarterly board meetings = $2,400 tax-free income to you, and a deduction for your business.
Rules to follow:
- You must document the meeting purpose and attendees
- Charge fair market rent (based on local short-term rental comps)
- Invoice yourself and document payments
Work with a certified CPA near you to structure this properly and ensure it withstands scrutiny. When handled right, this is a completely legal tax strategy, not a loophole.
5. QBID: The Qualified Business Income Deduction (Still Powerful in 2025 If You Qualify)
The Qualified Business Income Deduction (QBID) remains one of the most valuable tax-saving opportunities available to small business owners in 2025. But let’s be honest, it’s also one of the most misunderstood.
If you’re a sole proprietor, S Corporation owner, or partner in a pass-through entity, you may be eligible to deduct up to 20% of your qualified business income right off the top of your taxable income.
But here’s the catch: eligibility depends on your income, your industry, and how your business is structured.
2025 Income Thresholds:
- $200,000 for single filers
- $400,000 for married filing jointly
If your income is below these thresholds, you likely qualify for the full 20% deduction.
If your income is above those limits, the IRS applies restrictions based on:
- Whether your business is a Specified Service Trade or Business (SSTB) (think law, accounting, consulting, health, and financial services)
- How much your business pays in W-2 wages
- The unadjusted basis in qualified property (UBIA) held by the business
Translation: The closer you get to or cross the income threshold, the more complicated the math becomes.
6. Start-Up and Pre-Launch Costs, Claim Before You Sell a Thing
Launched a business this year? You might be sitting on thousands in deductible expenses before you even opened your doors.
The IRS allows you to deduct certain start-up costs and organizational costs, including:
- Branding, logos, and early marketing
- Market research and competitor analysis
- Legal, licensing, or incorporation fees
- Travel expenses related to business setup
- Software or tools purchased pre-launch
You can deduct:
- Up to $5,000 in startup costs
- Up to $5,000 in organizational costs
- The rest can be amortized over 15 years
Keep detailed records, and work with a tax professional near you to categorize these correctly. You can only claim these in your first year of active business so don’t miss it.
Bonus Strategy: Retirement Contributions for Small Business Owners (And the Tax Savings That Come With Them)
Let’s be honest: saving for retirement sounds like one of those things you’ll get to “someday.” But if you’re a business owner in 2025, “someday” should start today because retirement contributions are one of the most underused tax-saving tools available to entrepreneurs.
They don’t just help you build long-term wealth, they also slash your current taxable income. It’s a rare win-win in the tax world.
2025 Retirement Contribution Limits:
Solo 401(k):
- Contribute up to $23,500 as an employee (if under 50)
- Add an additional $7,500 if you’re 50 or older (total = $31,000)
- Plus, contribute up to 25% of your compensation as the employer
- Maximum total contribution: $69,000 in 2025 (or $76,500 if over 50)
SEP IRA:
- Contribute up to 25% of net self-employment earnings
- Max contribution cap for 2025: $69,000
Not sure which plan makes more sense? That’s what your Austin tax accountant is here for.
Why This Matters Right Now:
Every dollar you contribute reduces your adjusted gross income, which can:
- Lower your overall tax liability
- Increase your eligibility for deductions like the Qualified Business Income Deduction (QBID)
- Help you stay under IRS income thresholds for phaseouts and penalties
At Insogna CPA, we help business owners build custom retirement strategies that:
- Maximize contributions without overcommitting cash flow
- Integrate with your S Corp or LLC compensation structure
- Ensure proper documentation and deadlines to lock in your deduction for 2025
- Coordinate with your tax preparation services for full visibility
What Happens When You Skip Deductions Like This?
Here’s what we see far too often from businesses not working with a strategic CPA:
- Entrepreneurs overpaying $10,000+ annually by missing deductions
- Incorrect depreciation schedules on equipment costing thousands over 5 years
- Sole proprietors missing QBID due to income structure errors
- 1099 contractors getting flagged by the IRS for not submitting W-9s or mileage logs
- Clients forfeiting the Augusta Rule benefit because they didn’t document properly
These aren’t edge cases. They’re common. And they’re entirely preventable with the right certified public accountant near you, someone who goes beyond basic filing and builds a tax strategy aligned with your goals.
Why Work with Insogna CPA?
We’re not just another listing in your “tax services near me” search.
At Insogna CPA, we offer:
- CPA-led tax preparation services that go beyond data entry
- Strategic tax planning that aligns with your goals
- Deep experience with FBAR filing, Section 179 strategy, QBID, and more
- Full integration with our bookkeeping and accounting services
- Proactive communication because we don’t just show up at tax time
Whether you’re looking for a tax advisor near you, a small business CPA Austin, or just someone to help clean up last year’s missed deductions, we’re ready.
Let’s Find the Deductions You’ve Been Missing
Schedule a tax strategy review with Insogna CPA, a leading Austin CPA firm, and let’s:
- Identify missed opportunities
- Build a proactive tax plan
- Align your deductions with IRS-compliant documentation
- And keep more of your profit in your business, where it belongs
No fluff. No confusion. Just smart, clean, confident tax strategy.
Book your consultation today.
You run the business, we’ll handle the taxes.